Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B . The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, reasonable valuation levels and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
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Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Aerospace & Defense industry average. The net income increased by 6.9% when compared to the same quarter one year prior, going from $1,324.00 million to $1,415.00 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 6.0%. Since the same quarter one year prior, revenues slightly increased by 1.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- In its most recent trading session, UTX has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- UNITED TECHNOLOGIES CORP's earnings per share declined by 6.8% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, UNITED TECHNOLOGIES CORP increased its bottom line by earning $5.42 versus $4.74 in the prior year. For the next year, the market is expecting a contraction of 1.8% in earnings ($5.32 versus $5.42).
United Technologies Corporation provides technology products and services to the building systems and aerospace industries worldwide. United has a market cap of $71.3 billion and is part of the conglomerates sector and conglomerates industry. The company has a P/E ratio of 13.3, below the S&P 500 P/E ratio of 17.7. Shares are up 7% year to date as of the close of trading on Tuesday.
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--Written by a member of TheStreet Ratings Staff.
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